NYC Council Approves New Regs on Rideshare Services, Including One-Year Cap

The New York City Council has approved a package of bills to regulate Uber and other ridesharing services, including a first-of-its-kind, one-year freeze on the number of vehicles allowed on the city streets.

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Photo: Akos Stiller/Bloomberg

The New York City Council has approved a package of bills to regulate Uber and other ridesharing services, including a first-of-its-kind, one-year freeze on the number of vehicles allowed on the city streets.

Weathering a public relations offensive by ridesharing services in opposition to the vehicle cap, which was a factor in a failed attempt in 2015 by city leaders to rein in the fast-growing industry, the council approved the bill to impose the cap with 39 votes in favor and six votes against.

The vehicle cap bill, which proved to be the most contentious piece of legislation in the package in terms of how council members voted, includes an exemption for wheelchair-accessible vehicles, of which there is a relatively low percentage among app-based vehicle fleets in the city.

The legislation also contains a bill to implement minimum pay for drivers. The bills now go to Mayor Bill de Blasio, who has expressed support for the legislation, for his signature.

The bills were the product of months of negotiations and meetings by a Committee on For-Hire Vehicles, which was formed at the beginning of the year to consider regulations on the industry.

While the 2015 effort to regulate the rideshare services, classified as for-hire vehicles, was unsuccessful, in the years since, increasing congestion on the city streets and a rash of recent driver suicides that were linked to the falling value of taxi medallions motivated city leaders to take a more aggressive approach to the industry.

Councilman Brad Lander, who represents the Park Slope section of Brooklyn and who serves on the FHV committee, said at a meeting of the committee on Wednesday morning that, while app-based service has been a game-changer for New Yorkers, particularly those in the outer boroughs where taxi service is scarce, the package of bills “gets the balance right.”

“We are confronting plummeting driver pay and rising driver poverty, growing congestion, the need for wheelchair-accessible FHV service for thousands of New Yorkers, with the need to provide good service to customers and we don’t take that for granted,” Lander said.

There were about 74,000 for-hire vehicle licenses issued in 2014—which includes app-based services as well as livery cabs—and that number has grown to about 130,000 today, said Councilman Stephen Levin, who represents neighborhoods in downtown Brooklyn and surrounding areas and who sponsored one of the bills, during the meeting.

Among those who voted against the bill were Councilman Eric Ulrich, a Republican who represents neighborhoods in southeastern Queens, who called yellow cabs a “declining industry with an outdated business model” and who likened placing a cap on the number of for-hire vehicle on city streets to placing a cap on “Netflix subscriptions because we’re worried about Blockbusters closing.”

“This is a free market and we have to be able to move with the market,” Ulrich said.

As for the ridesharing services themselves, Uber and Lyft issued statements following the council’s vote denouncing the council’s legislation, reiterating its criticisms that a vehicle cap will have disproportionately negative effects for residents of the city’s outer boroughs, where both taxi and subway service tends to be relatively skeletal.

“These sweeping cuts to transportation will bring New Yorkers back to an era of struggling to get a ride, particularly for communities of color and in the outer boroughs,” said Joseph Okpaku, vice president of public policy for Lyft. “We will never stop working to ensure New Yorkers have access to reliable and affordable transportation in every borough.”

Danielle Filson, a spokeswoman for Uber, said the freeze on vehicles will “threaten one of the few reliable transportation options” in the city while doing nothing to alleviate congestion in the city or fix the subways, which have drawn New Yorkers’ ire in recent years as service has diminished and delays have increased.

Filson said that Uber takes Council Speaker Corey Johnson “at his word that the pause is not intended to reduce service for New Yorkers and we trust that he will hold the TLC accountable, ensuring that no New Yorker is left stranded,” she said. “In the meantime, Uber will do whatever it takes to keep up with growing demand and we will not stop working with city and state leaders, including Speaker Johnson, to pass real solutions like comprehensive congestion pricing.”

But both companies have said they support lifting drivers’ wages as well as placing a surcharge on vehicles moving through certain portions of Manhattan during peak traffic hours, known as congestion pricing.

Andrew Denney

Andrew Denney is a New York-based reporter covering litigation and other news from the federal and state courts. He can be reached at adenney@alm.com. Twitter: @messagetime

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